$49
cohodk
Posts: 19,123 ✭✭✭✭✭
https://sdbullion.com/silver-prices-1980
Silver traded at $49/oz on this day 43 years ago. It would again hit $49 on April 25, 2011.
When will we see 49 again?
Excuses are tools of the ignorant
Knowledge is the enemy of fear
3
Comments
Dec 2026?
I cannot predict when, however, based on the geo-economic trajectory, IMO, it will be within the next two years. No evidence to support that, just gut feel. Cheers, RickO
Sooner than even you would think.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Today
How much do you want to buy?
Seriously though, I have some vintage old pour stuff that should bring $49/$100 an ounce.
So you're talking generic melt silver at $49.
I don't know the answer to that.
I could see it hitting $49 again.
My YouTube Channel
Maybe....how do you arrive at this date?
Knowledge is the enemy of fear
Not "Again" x3™ In This Lifetime RGDS!!
The whole worlds off its rocker, buy Gold™.
I buy both gold and silver when I can. I’d say it is much more likely we hit $15 per ounce silver before we see $35. $49 is something I don’t see happening for the foreseeable future.
Buy silver and gold because you like it and have fun with it. It’s not going to make you rich.
Not in my lifetime, and I would suspect, not in most of our forum members lifetimes. PS I'm hitting 80
@cohodk asked "@Higashiyama said: Dec 2026?
Maybe....how do you arrive at this date?"
It was a totally "naive" and simple calculation that gave a probably defensible result. When I first saw your question, what instantly popped into my head was: it will take about half the time to get to $ 49 for the third time as it did to get there the second time. It took a bit more than 31 years from the first peak to the second.
If I were leading a workshop on this topic (which would be a heck of a lot of fun, but I don't really have enough background on silver fundamentals to do it), the next step, after coming up with the naive but possibly plausible estimate, would be to construct 3 - 4 real world scenarios that lead to this price.
Not naive. You used hard data to construct an opinion, which is so much better than many attempt.
We might also be able to construct an uptrend line that could project to 49 sometime in 2029. A double from here in 6 years would still be about 12% per year.
Maybe on the 50th anniversary?
Knowledge is the enemy of fear
$49 in 2049
The optimist in me would like to say soon. The realist side knows better though. I’d say not for another decade or more.
$49 is an event. When it comes again, it will be the same thing all over again. A great skimming.
I think the predictions by the 3 banks above seem reasonable for 2023. Got off to a good start but gave it all back this week.
I'd guess 2027 at the latest.
A double in 4 years would make many cheer. What do you see as the catalyst?
Knowledge is the enemy of fear
I'd saw within the next 36 months.
FWIW: $49 USD in 1980, adjusted for inflation in 2023 is ca. $177 USD.
Increased usage in solar and EVs.....old mines being retired....no new major supplies....investor demand for folks who don't want to spend more on gold.
I also think speculators might sell platinum and palladium to buy silver.
Here's a sell-side research report with a $27 price target for silver in 2026, up $4 from the earlier price target.
@GoldFinger1969
Thank you for an interesting report, but unfortunately a bit outdated as their DXY projections in January did not expect the recent increase in US interest rates. Stronger dollar (up 4% in February) seems to be back for a while longer, and so PM's are likely to stay flat or down until that trend reverses again.
My US Mint Commemorative Medal Set
I have continuing research I'll post.
Don't focus on predictions or price targets....focus on the underlying fundamentals that they talk about which are more permanent. Those are a better guide for you and a better foundation upon which to make investment decisions.
Don't focus on predictions or price targets....focus on the underlying fundamentals that they talk about which are more permanent. Those are a better guide for you and a better foundation upon which to make investment decisions.
You might do well to apply that principle to fiat currencies in general, and to the dollar, specifically.
I knew it would happen.
Since I live in America and use the dollar, it's not that critical.
Fiat currencies are here to stay unless you think Gold-Pressed Latinum is coming anytime soon.
Seriously, we are lucky and fortunate to live in a country that is the world's global reserve currency and has the most liquid and transpartent financial markets in the world. Do you know of any other country or money market that can handle a $10 billion order at 2:55 PM on a Friday and guarantee the owner that the funds will be available 1st-thing Monday Morning ?
China ? Russia ? Arab countries ? Euro countries ?
Nope, nope, nope, and nope.
2030
Since I live in America and use the dollar, it's not that critical.
Fiat currencies are here to stay unless you think Gold-Pressed Latinum is coming anytime soon.
So, it doesn't matter that the burden for the ponzi scheme will fall on the shoulders of ordinary working people, as long as the bankers get to deal the cards and collect interest on the imaginary money they create? Am I interpreting that correctly?
I knew it would happen.
No, you are not.
Where are all these profits that the bankers are supposedly making ? How come their stocks have been such lousy performers ? Why is Citibank 1/10th the price 15 years ago ? Why has JP Morgan Chase lagged the S&P 500 for most time periods ?
Ultra-low rates and spreads lead to low Net Interest Margins (NIMs) which are bad for banks.
Banks aren't collecting interest on bank resereves in a 0%-rate environement, JM.
It's next-to-nothing.
Might BE nothing !!
Fractional reserve banking should be abolished. It's not the bank's money to begin with, so there is no justification for the banks to be lending something they never had in the first place.
I knew it would happen.
@jmski52 said "Fractional reserve banking should be abolished."
This is almost equivalent to saying "banking should be abolished".
Can you describe in detail what a banking system in 2023 would look like without the fractional reserve concept? Keep in mind that this is not a new concept, and is not something that was invented in 1913 along with the Fed. Fractional reserve banking predates the founding of the United States, and fractional reserve banking grew up in the the United States over more than 200 years, hand in hand with the development of the US economy. In fact, it was an essential facilitator of the development of the US economy.
Then you want a barter economy with no credit or monetary systems. You'd cut GDP growth in half, if not more.
An economy without credit is like an auto engine without oil.
I look up real bills. This was discussed here at length, several years ago.
The fractional reserve debt-based banking system benefits the issuers of the debt (the bankers) first, and foremost.
The bankers produce nothing themselves, but get interest payments for something that they issue at zero cost. Please explain to me how that is honest, ethical or fair.
This ought to be enlightening.
I knew it would happen.
Enlightenment only shines on those who wish to come out of the dark.
Knowledge is the enemy of fear
You think the bankers who gave all of our parents and grandparents mortgages at 4-6% in the 1950's and 1960's benefitted from those loans when inflation was running at 8-10% for a decade-plus ?
It's NOT at zero cost. The cost of funds is usually around 2-4% which results in a NIM -- net interest margin -- of anywhere between 250 - 400 bp.
If their cost of funds were ZERO their NIM would be closer to 600 bp (6%) and their ROEs and ROICs would be 2x as high.....and their stocks would sell at 25-40x earnings instead of 10-12x EPS.
You think the bankers who gave all of our parents and grandparents mortgages at 4-6% in the 1950's and 1960's benefitted from those loans when inflation was running at 8-10% for a decade-plus ?
Like I said, the fractional reserve debt-based system benefits the issuers of the debt (bankers) first and foremost. What happened 10 or 15 years later was due to fluctuations in the bond market, and I'm quite sure that the bankers were well-covered for those fluctuations. If not, their accountants should have been fired.
It's NOT at zero cost. The cost of funds is usually around 2-4% which results in a NIM -- net interest margin -- of anywhere between 250 - 400 bp.
If their cost of funds were ZERO their NIM would be closer to 600 bp (6%) and their ROEs and ROICs would be 2x as high.....and their stocks would sell at 25-40x earnings instead of 10-12x EPS.
Sounds like gobbledygook to me. It costs zero to tap on a keyboard and add digits to an account. Any relationship to a stock price illustrates nothing concerning a cost. Stock price is the result of performance, not a component of cost.
I knew it would happen.
Knowledge is the enemy of fear
Fractional reserve banking doesn't benefit or hurt anybody by itself. What do you think you are referencing when you say "fluctuations in the bond market" ?? You're talking about fluctuations and disturbances to banking, which means they are not positive for bank earnings. You brush it off like nothing by saying/hoping/speculating that "the bankers were well-covered for those fluctuations." No, they were not and are not. You can't insulate against every market force.
Accountants have NOTHING to do with balance sheet or income statement stability. If the regulators who oversee the banks can't mandate or force banks to do that, what makes you think "accountants" can ?
But that's not what is happening. I'm not sure that you understand how monetary policy and banking work. No bank taps on a keyboard and adds digits to any account. This is a fallacy. Banks have to attract deposits and that costs money...they compete with pension plans, 401(k)'s, brokerage accounts, money market funds, foreign currencies, etc. That costs money.
It might be "gobbledygook" to you because you've read stuff off the internet that jibes with your view of the world -- but that is NOT how the world really is nor how banking works. If you looked at a bank's balance sheet, income statement, and consolidated statement of cash flows I think you would learn alot.
tut, tut.............if the bankers couldn't identify a market trend in 10 or 15 years and then advise their managements to put some market hedges in place, they should have been fired. You go around and around dancing around simple points with banking bs, when it's not hard to put together on the face of it.
Fractional reserve banking allows bankers to lend money that they don't have and didn't earn, and then to lend it out for interest. That is benefiting at someone else's expense. Period. First and foremost, the bankers benefit by creating free money (for themselves) and lending it out at interest. What's so hard to understand here?
Accountants have NOTHING to do with balance sheet or income statement stability. If the regulators who oversee the banks can't mandate or force banks to do that, what makes you think "accountants" can ?
Interesting statement. I'd never hire an accountant who wasn't capable of telling me when my balance sheet or income statement was all out of whack with 10 year old loans that needed to be hedged in the market or sold off.
No bank taps on a keyboard and adds digits to any account.
Except for the Fed and the rest of the banking system.
Banks have to attract deposits and that costs money...they compete with pension plans, 401(k)'s, brokerage accounts, money market funds, foreign currencies, etc. That costs money.
Enlighten me. Why was there a reserve requirement, and why is the reserve requirement now zero? Why can the banks issue more loans than they have as working capital? This is an industry that sorely needs reform.
Like I said, they tap on a keyboard and lend out money (at interest) that didn't exist 2 seconds prior.
Nobody else gets to do that without going to prison.
I knew it would happen.
(1) Accountants do not offer advice on hedging risk. They also don't recommend treatments to lower cholesterol.
Neither is part of their job description.
(2) You continue to say that banks lend out money that isn't theirs without any proof. You have been misled by anti-banking, barter economy types who quite frankly don't know what they are talking about. With over 4,500 banks, you should be able to show us 1 or 2 banks that are getting "free money." I bet you can't name one.
(3) The Fed can create high-powered reserves and add liquidity to the banking system through open market operations (buying and selling Treasury bills/notes/bonds). That is NOT the same as creating "free money." The same banks can gain liquidity by offering me a a 6% CD.
(4) Reserve Requirements are counted as Tier 1 capital. It helps keep the system liquid and functioning. They are a backstop against sudden liability surges from depositors, customers, or the Fed.
You continue to be fixated on banks creating "free money" when nothing of the sort exists. You don't understand how credit and capital are allocated in a modern free market system. I'm not sure what you majored in during college, or what books you have read, or what you do for a living. But your statements are NOT backed up by facts and the experience of the banking system and individual banks the last 30-50 years disproves what you are saying.
If what you were saying was true....banks never would have had problems in 2007-09....their P/E multiples would be alot higher to reflect the ability to manufacture profits at will....their returns on equity and invested capital would rival software companies....and no banks would ever run into financial trouble.
If you think those are the norm the last few decades, there's not much I can do to dissuade you.
This debate isn't worth it. I stand by my observations. Have a nice day!
I knew it would happen.
Fixed it for ya.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
They loan out depositor's money.
Banks create high powered profits by collecting interest on loans of other people's money.
When commercial banks lend money, they expand the amount of bank deposits. The banking system can expand the money supply of a country beyond the amount created or targeted by the central bank, creating most of the broad money in a process called the multiplier effect. While this creates new money the only reason it is not free money for the bank is the fact that they take some risk with the loans that generate this new money. Of course the new money helps generate more new money when it is used to make more loans.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Derry, the larger point remains: there is a cost of funds for all of what you and others cite. If banking were as lucrative and easy as some believe, the profit margins would be 2-3x what they are and no bank would ever have financial difficulty.
Banks have to pay for ALL deposits so nothing is free regardless of any multiplier effect...which, BTW, can work in reverse as the Fed DRAINS money from the system which is what they have been doing with the Fed Funds rate going to 4.50-4.75% and QE ending and morphing into QT.
Warren Buffet today called out "economic illiterates" who don't understand stock buybacks. I agree 100%. Let's hope he next targets anti-banking demagogues in Washington and around the country.
Bank profit margins? Why do the tallest and largest office buildings in metro areas belong to banks and insurance companies?
Who benefited most from QE?
And finally, who owns the Federal Reserve?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Audit the Federal Reserve.
I for one would not put any faith in the numbers
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Hard to argue with that.
Knowledge is the enemy of fear
Don't expect $49 gutter in this lifetime. Every commodity on planet earth has made big runs these past several years. Gutter is still in the gutter and headed deeper. RGDS!
The whole worlds off its rocker, buy Gold™.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Many commodities have hit the skids because of speculative buying ending. That's what happened to silver and gold back in 2011-12....they've been base-building ever since, and are now on much stronger fundamentals than before.
I'm not one of these "silver is going to $100/oz." jokers but I do believe silver can make sustained, multi-year gains going forward as the headwinds from reduced sources of demand (i.e., photography) subside and new sources (batteries, EVs, etc.) come to the forefront, plus burgeoning middle-class demand in China and the new, most populous country on Earth...India.
For most of the last 50 years, we have calculated demand based on a buying population of about 300-500 million (the Western OECD countries, more or less). Well now the potential market is closer to 2 BILLION and even though many don't have the disposable income we have....many do.
These emerging countries -- China, India, African, Asian, etc. -- will be buying what they KNOW (gold, silver) and not rhodium or palladium or other exotic metals.
Why not hear from some historical figures who knew a thing or two about banking.
===============
“The gold standard is not possible in a welfare state.” Alan Greenspan
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. Gold still represents the ultimate form of payment in the world. Fiat money in extremis is accepted by nobody. Gold is always accepted.”
-- Alan Greenspan
If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.”
-- Alan Greenspan
It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. Henry Ford
Inflation is taxation without legislation. Milton Friedman
Derivatives are financial weapons of mass destruction. Warren Buffett
All money is a matter of belief. Adam Smith
The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. Friedrich August von Hayek
What overturned the section of the Banking Act of 1933?
It became more controversial over the years and in 1999 the Gramm-Leach-Bliley Act repealed the provisions of the Banking Act of 1933 that restricted affiliations between banks and securities firms.
The Glass-Steagall Act was repealed in 1999 amid long-standing concern that the limitations it imposed on the banking sector "were unhealthy and that allowing banks to diversify would reduce risk."
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks…will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered…. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” – Thomas Jefferson in the debate over the Re-charter of the Bank Bill (1809)
Let me issue and control a nation’s money and I care not who writes the laws.” Mayer Amschel Rothschild (1744-1812), founder of the House of Rothschild.
The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.” The Rothschild brothers of London writing to associates in New York, 1863.
“I believe that banking institutions are more dangerous to our liberties than standing armies.” –Thomas Jefferson
“History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance.” -James Madison
“Issue of currency should be lodged with the government and be protected from domination by Wall Street. We are opposed to…provisions [which] would place our currency and credit system in private hands.” – Theodore Roosevelt
“The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. Money will cease to be master and become the servant of humanity.” -Abraham Lincoln
Despite warnings, Woodrow Wilson signed the 1913 Federal Reserve Act. A few years later he wrote: “I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.” -Woodrow Wilson
Years later, reflecting on the major banks’ control in Washington, President Franklin Roosevelt paid this indirect praise to his distant predecessor President Andrew Jackson, who had “killed” the 2nd Bank of the US (an earlier type of the Federal Reserve System). After Jackson’s administration the bankers’ influence was gradually restored and increased, culminating in the passage of the Federal Reserve Act of 1913. Roosevelt knew this history.
The real truth of the matter is,as you and I know, that a financial
element in the large centers has owned the government ever since
the days of Andrew Jackson… -Franklin D. Roosevelt
(in a letter to Colonel House, dated November 21, 1933)
The banks do create money. They have been doing it for a long time, but they didn’t realise it, and they did not admit it. Very few did. You will find it in all sorts of documents, financial textbooks, etc. But in the intervening years, and we must be perfectly frank about these things, there has been a development of thought, until today I doubt very much whether you would get many prominent bankers to attempt to deny that banks create it.” H W White, Chairman of the Associated Banks of New Zealand, to the New Zealand Monetary Commission, 1955.
“… our whole monetary system is dishonest, as it is debt-based… We did not vote for it. It grew upon us gradually but markedly since 1971 when the commodity-based system was abandoned.” The Earl of Caithness, in a speech to the House of Lords, 1997.
The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it. The process by which banks create money is so simple the mind is repelled. With something so important, a deeper mystery seems only decent.” John Kenneth Galbraith (1908- ), former professor of economics at Harvard, writing in ‘Money: Whence it came, where it went’ (1975).
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The above banking is what most people are familiar with. There's another side though. The bankers created an opaque, over-the-counter derivatives "debt-money-gambling" system essentially divorced from Govt oversight and control. They grew their off-balance sheet value from $1 TRILL in 1989 to over $1.14 Quadrillion by fall of 2008....a 1000x increase in under 20 yrs. In this casino TBTF banks leverage bets by 15x to 50x. In 2007-2008 $Trillions in otc MBS wagers were betting that little guys would fail on their mortgages. And fail they did. 2008 winners were paid off by the FED....losers either closed their doors or were "assumed" by larger entities. The next set of "winners" will be paid off by both bank depositors and the FED. Banking laws were changed in the past 10 yrs to allow banks to put depositors behind otc derivative's pay outs if and when another crisis occurs. The bank's otc bets get settled first.